In the weeks leading up to the crucial elections in November, the Biden presidency and opposition Democrats are becoming more harsh on China while launching more frequent attacks on Asian allies.
It is unclear how much either could go in targeting Asian countries and businesses, but they have already damaged America’s standing in the area.
Considerably, the US Commerce Department intends to prevent foreigners from using US cloud computing services, and both the Biden administration and Congress are eager to give the office roles akin to those of an intelligence organization.
We’re starting the process of requiring US fog companies to show us every time a non-US entity uses their cloud to coach an enormous language model, Commerce Secretary Gina Raimondo stated on January 26.
The Commerce Department has been looking for ways to restrict access to the cloud computing AI services offered by Alphabet ( Google ), Amazon, Microsoft, and other US technology companies ever since President Joe Biden ordered the department to identify foreign entities that could use artificial intelligence to carry out “malicious cyber-enabled activity.”
Raimondo continued,” We want to make sure we close down every opportunity the Chinese might have to get our designs or teach their own versions.
More Chinese buyers may turn to Alibaba, Baidu, Huawei, Tencent, and another Chinese cloud computing service providers if and when this is done, while US government regulations on the private sector are intensified.
According to The Washington Times, the Biden administration and members of Congress are debating how to best bolster and strengthen the Commerce Department’s foreign investment screening and export controls.
The Commerce Department has received harsh criticism for both failing to stop US technology transfers to China and for illicit surveillance of individuals based on their ethnicity in China.
New political warnings are then ringing about an impending “flood” of “legacy” Chinese chips.
In a letter to Raimondo and US Trade Representative Katherine Tai on January 5, the House Select Committee on the Strategic Competition Between the United States and Chinese Communist Party chairman Mike Gallagher (R-WI ) and ranking member Raja Krishnamoorthi (D-IL ) expressed their concern that China will saturate the US and international markets with” subsidized foundational semiconductors” ( also known as legacy chips ) in an effort to overthrow the “lifeblood” of the modern economy and military.”
More than 20 new semiconductor companies, or fabs, are being built by the Chinese, and almost all of them are focused on older cluster semiconductors—techniques that are older and more well-established and are not yet the target of US sanctions.
The Fletcher School of Law and Diplomacy professor Chris Miller wrote in a recent FT essay,” Tariffs are the usual tool for dealing with dumping, but the West does n’t directly import large volumes of Chinese chips, they’re embedded inside finished devices.” He is the author of an authoritative book on the US-China chip war.
It should be noted that the obvious risk is never a storm of chips coming out of China but loss of device sales to China until China achieves self-sufficiency and thus resistance to US restrictions through buy substitution, which could also take several years.
The risk is significant because China produces less than 10 % of the world’s semiconductors but about 30 % of all semiconductor sales worldwide.
It is also important to take into account the dependence of US, European, and Chinese manufacturers of semiconductor production equipment on Chinese income. These income, which are enabling China’s adult network semiconductor industry to grow quickly, have accounted for almost 40 % of their total sales in recent quarters.
Taiwanese manufacturers of semiconductor equipment anticipate a powerful Chinese demand this year, but those 20 new factories will finally be finished, and Chinese producers like AMEC and Naura are expanding and becoming more technologically advanced.
Around the time of Biden’s State of the Union address in early March, when he’ll likely remind voters that the chip war is n’t just about national security but also about new tech investment and jobs in the US, the biden administration is anticipated to announce new billion-dollar grants under the CHIPS Act.
The first two grants, to BAE Systems and Microchip Technologies, suppliers in the defense sector, were only$ 35 million and$ 162 million, respectively. But, Raimondo announced in December that she would award about a dozen more prestigious prizes the following month. These will likely involve money for the enormous semiconductor fab development projects that TSMC and Intel are planning.
Chipmakers and politicians have been irritated by delayed CHIPS Act product brought on by workers disputes and bureaucracy, but the democratic cycle is now on their part. The share of chip-making products profits to China will probably rise as US fab development projects progress, which may spur calls for actually stricter trade restrictions.
In the open election season in America, China’s growing dominance of the electric vehicle ( EV ) market is also a target.
A powerful EV, and then an intelligent vehicle, is filled with hundreds of electronics and sensors, Raimondo said on January 30 during a conversation sponsored by the Atlantic Council. It gathers a ton of data about the pilot, the vehicle’s location, and the area around the car. Do we want Beijing to receive all of that information?
It is debatable whether the issue is actually one of national security, the inability of US automakers ( aside from Tesla ) to compete with Chinese EVs, or both, but it is likely that Donald Trump’s 27.5 % import tariff on Chinese cars wo n’t be lifted anytime soon. On the other hand, the income may remain raised and supplemented with additional limitations.
It is important to note that Hyundai and its affiliates Kia from South Korea have surpassed GM and Ford in the US EV market in addition to trailing Tesla. Market research organizations report that Tesla currently controls 57.4 % of the local EV market, followed by Hyundai and Kia at 7.5 %, GM at 7 %, and Ford at 5.5 %.
Elon Musk stated on Tesla’s most recent earnings phone,” Our study is usually that the Chinese car companies are the most competitive in the world.” Depending on the type of price or deal barriers put in place, I believe they will be very successful outside of China.
Musk believes that if trade barriers are not put in place, Chinese EV manufacturers” will very much demolish most another car companies in the world.” Musk’s claim plays into the hands of anti-China politicians and appears to be intended to protect the US market for Tesla.
But, the conflict between US and Chinese officials has not ended. Republican Senator Tom Cotton of Arkansas infuriated many Singaporeans by asking TikTok CEO Chew Shou Zi,” You said now, as you often say, that you live in Singapore,” during a Senate Judiciary Committee hearing on the negative effects of social press on children. What country are you a member of ? ,
When Chew identified himself as a Singaporean citizen, Cotton questioned him about his citizenship status and whether he had actually applied for Chinese citizenship. He also enquired as to his membership in or affiliation with the Chinese Communist Party.
Chew retorted,” No, Senator, I’m from Singapore.” Singapore does not permit two membership after the age of 21.
Cotton then questioned Chew about the Tiananmen Square Massacre, the alleged “genocide” against racial Uighur Muslims in China’s northwest Xinjiang, where protest were shot and killed in 1989, as well as whether he agreed with President Biden that President Jinping is a “dictator.”
Are you concerned that you’ll lose your job if you say anything unfavorable about the Chinese Communist Party? Cotton questioned when Chew responded,” Someone who cares about this subject or any subject freely expresses themselves on TikTok.” Are you concerned that the next time you visit northeast China, you’ll be detained and vanish?
Some people compared it to Senator Joe McCarthy’s anti-communist monster kill in the 1950s. It was covered by the South China Morning Post under the article” Singaporeans denounce US president’s questioning of TikTok CEO Chew Shou Zi about his nationality and connections to China: “pure ignorance.”
Less restrained remarks were made online, including “racist,”” xenophobic,” and” Just because he looks Chinese does n’t mean He’s from China.”
According to The Straits Times of Singapore, TikTok is now “punching handbag at a time when intense rivalry with China informs nearly every aspect of US policymaking.” Singapore, a US Navy port of call that is carefully located, has as well, it claimed.
However, Singapore is one of the countries in the world with the highest level of penetration and influence by the Chinese Communist Party, Cotton said while speaking on Fox News.
His remarks also sparked private US reaction. The “progressive” candidates of Eastern American, Native Hawaiian, and Pacific Island descent are supported by the political action committee known as the AAPI Victory Fund, which posted on X that Senator Tom Cotton’s questioning is “disgraceful, clearly racist and seriously dangerous.”
Regarding Japan, the Nikkei magazine reported on February 1 that Trump had interfered with Nippon Steel’s purchase of US Steel and that Biden is under increasing pressure as both parties watch Pennsylvania vote.
” I had immediately stop it. Without a doubt,” said Trump. ” We saved the steel industry, and then Japan is purchasing US Steel.” It’s really awful. The title of the Nikkei two days later read,” Titanium workers union asserts that Biden is also opposed to Nippon Steel’s purchase of US Steel.”
This begs the question of whether Biden, Trump, US officials, and the United Steelworkers union would be so vehemently opposed to a American or European company taking over.
After all, American management is known for mass layoffs in the quest of success and efficiency, no Japanese management. Since 2018, US Steel has laid off a third of its workplace while being managed by Americans.
When Japanese Prime Minister Fumio Kishida trips Washington in April, the matter might be brought up. With months until the November vote, Japan, like Singapore, might find itself awkwardly mired in the deeply divided and disorganized politics of America.
Following this author at X: @ScottFo83517667on .